Jamie Oliver’s restaurant chain Jamie’s Italian has appointed administrators, putting as many as 1,300 jobs at risk.
There are two Jamie’s Italian restaurants in Scotland, with one based in Edinburgh and the other in Glasgow.
The group, which includes the Jamie’s Italian chain, Barbecoa and Fifteen, has appointed KPMG as administrators.
In total, 25 restaurants are affected by the move. Twenty-three of those outlets are from the Jamie’s Italian chain.
Jamie Oliver said: “I am deeply saddened by this outcome and would like to thank all of the staff and our suppliers who have put their hearts and souls into this business for over a decade.
“I appreciate how difficult this is for everyone affected.”
The TV chef added: “We launched Jamie’s Italian in 2008 with the intention of positively disrupting mid-market dining in the UK High Street, with great value and much higher quality ingredients, best-in-class animal welfare standards and an amazing team who shared my passion for great food and service.
“And we did exactly that.”
Eileen Blackburn, head of restructuring and debt advisory at French Duncan LLP, said: “The news that Jamie Oliver’s restaurant chain has gone into administration is unwelcome, but not surprising given the enormous financial struggles that the sector has faced in recent years.
“In Scotland there were 136 restaurants which went through the insolvency process, which was the highest figure ever and I believe that this is likely to continue as high street businesses struggle to keep afloat.”
“The combined pressures of high business rates coupled with inflexible leases and sky-high rents are making it extremely difficult for the casual dining sector to survive.
“There needs to be a major examination of the way in which the high street operates to ensure that we have town and city centres to visit in the future.”
Ms Blackburn added: “Unfortunately the fate of large restaurant chains and independent outlets remains in the hands of landlords and councils who both believe that they can continue to charge enormous sums of money at a time when margins have never been tighter.
“With higher minimum wages, greater food import costs, and more competition it is clear that the casual dining market is under attack as never before. The administration of Jamie Oliver’s restaurant is simply the latest manifestation of the malaise impacting upon the high street.”
Donald Boyd, a partner with Campbell Dallas and a leisure sector specialist, warned that over-supply, high fixed costs, and changing fashion will likely cause further casualties.
“The administration of Jamie’s is a warning call to other restaurant operators to keep a very tight rein on costs and ensure they are not being left behind by the latest eating trends,” he said.
“The Glasgow restaurant scene, for example, has seen dramatic expansion in the last ten years but those entrepreneurs that fail to innovate will struggle.
“Business owners must ensure they are constantly evolving their offering and ensure they have high margin products that attract customers, and they are able to cover their fixed costs.
“The sector is probably ripe for restructuring, and Jamie’s should be a warning to all restauranteurs to review their business models.”